Section 8 Fair Market Rent (FMR) for ZIP 77840 - 2027

Investment Score for ZIP 77840

Based on 1% Rule: A+ (≥1.5%) | A (≥1.2%) | B (≥1.0%) | C (≥0.8%) | D (≥0.6%) | F (<0.6%)

FY 2027 Fair Market Rent Rates

Unit Size	Monthly FMR
Studio	$1,010
1 Bedroom	$1,070
2 Bedrooms	$1,160
3 Bedrooms	$1,610
4 Bedrooms	$1,910
5 Bedrooms	$2,216
6 Bedrooms	$2,482
7 Bedrooms	$2,681
8 Bedrooms	$2,815

Investment Analysis by Bedroom Size

Zillow median home prices vs Section 8 FMR rates (Data: 2026-07-31)

Bedrooms	Monthly FMR	Median Price	1% Rule	Grade
1BR	$1,070	$151,764	0.71%	D
2BR	$1,160	$201,950	0.57%	F
3BR	$1,610	$275,761	0.58%	F
4BR	$1,910	$351,190	0.54%	F
5BR	$2,216	$566,430	0.39%	F

Demographics & Housing Statistics

U.S. Census Bureau data (2024)

### Market Analysis for ZIP Code 77840 (College Station, TX) #### Section 8 Voucher Dynamics The Fair Market Rent (FMR) figures for ZIP code 77840 in College Station, TX, for 2026 are as follows: - 0BR: $1040 - 1BR: $1090 - 2BR: $1200 (which is 47.4% of the median household income) - 3BR: $1670 - 4BR: $1950 These FMRs represent the maximum rent that a Section 8 voucher holder can pay. However, comparing these figures to actual rental prices reveals significant discrepancies. For instance, the Zillow median price for a 2BR property is $201,412, which translates to a monthly mortgage payment of approximately $1,400 based on typical financing terms. This means that the actual rent for a 2BR unit would likely be higher than the FMR of $1200, creating a constraint for voucher holders who cannot afford to pay above their allocated amount. #### Affordability & Renter Profile ZIP 77840 has a high renter population percentage of 89.7%, indicating that most residents are renters rather than homeowners. The occupancy rate stands at 88.0%, suggesting that there is a slight oversupply of units but still a strong demand due to the high renter population. The median household income is relatively low at $30,377, making it challenging for many residents to afford housing outside of subsidized programs like Section 8. Given the high renter population and low median income, the majority of renters are likely students, young professionals, and families who rely heavily on affordable housing options. The affordability gap is evident when we consider that the FMR for a 2BR unit is only 47.4% of the median income, leaving little room for other expenses. This tight market dynamic makes it essential for landlords to offer competitive pricing to attract tenants, especially those who are Section 8 voucher holders. #### Investor Angle From an investor perspective, the ZIP code's cash flow potential needs to be evaluated against the FMR. The price-to-FMR ratio for a 2BR unit is 14.0x, meaning that the median home value is significantly higher than the FMR. This ratio suggests that purchasing properties at the median price would not be financially viable for investors relying solely on FMR-based rents. To determine if the ZIP is cash-flow positive at FMR, we need to consider the typical costs associated with owning a rental property. Assuming a purchase price of $201,412 for a 2BR unit, the monthly mortgage payment would be around $1,400. Adding property taxes, insurance, maintenance, and other expenses, the total cost could easily exceed the FMR of $1200. Therefore, the ZIP is not cash-flow positive at FMR levels. The investment grade for this ZIP code would be considered low due to the mismatch between the median home values and the FMR. Investors should be cautious about overpaying for properties in this area, as they might struggle to find tenants willing to pay the full FMR. #### Specific Actionable Insights 1. **Focus on Lower-Rent Properties**: Given the high proportion of renters and low median income, investors should focus on acquiring lower-rent properties such as 0BR and 1BR units. These units have FMRs of $1040 and $1090, respectively, which are more likely to align with the financial capabilities of local residents. 2. **Consider Off-Market Deals**: To avoid paying the median home value, investors should look into off-market deals, such as foreclosures or properties sold directly by owners. This strategy can help reduce the acquisition cost and make the property more financially viable at FMR levels. #### Bottom Line For Section 8-focused investors, the recommendation for ZIP 77840 is to **skip** this market unless they can acquire properties at a significant discount below the median home value. The high price-to-FMR ratio and low median income make it difficult to achieve positive cash flow at the FMR levels. If investors must enter this market, they should prioritize smaller units where the FMR is closer to the actual rent they can charge. --- This analysis provides a clear and concise overview of the rental market dynamics, affordability challenges, and investment potential in ZIP code 77840, based strictly on the provided data.

Data Sources: FMR data from HUD (2027). Median home prices from Zillow (2026-07-31). Demographics from U.S. Census (2024).

About FMR: Fair Market Rent (FMR) is used to determine payment standards for the Section 8 Housing Choice Voucher program, initial renewal rents for some expiring project-based Section 8 contracts, and rent ceilings for HOME Investment Partnerships.